Opinion
Docket No. 10883.
Decided July 31, 1972.
Appeal from Wayne, James Montante, J. Submitted Division 1 February 9, 1972, at Detroit. (Docket No. 10883.) Decided July 31, 1972.
Complaint by Gerald Taines, Michael Z. Taines, and Alger Homes, Inc., against Jack Munson and Evelyn Munson for an accounting on an equitable mortgage. Judgment for defendants. Plaintiffs appealed. Reversed and remanded for an accounting, 19 Mich. App. 29 (1969). Defendants appeal, and plaintiffs cross-appeal. Affirmed in part and modified in part.
Kratchman Kratchman, P.C., for plaintiffs.
Dykema, Gossett, Spencer, Goodnow Trigg (by Donald E. Shely), for defendants.
This case is now making its second appearance before this Court. In its prior appearance, this Court reversed the trial court and declared a deed absolute on its face to be an equitable mortgage, and remanded the case to the trial court for an accounting. Rather than again reciting the lengthy factual situation, we refer the reader to the prior case, Taines v. Munson, 19 Mich. App. 29 (1969).
The trial court conducted the necessary proceedings on remand, and subsequently entered its judgment. This appeal is from the accounting made by the trial court.
Defendants raise five arguments on appeal, which we shall consider in the order in which they are raised. Defendants first argue that there is no evidence in the record to support a judgment against Evelyn Munson, and that the trial court therefore erred in not granting a motion for summary judgment. The trial court in fact found that there was no evidence to support a judgment against Evelyn Munson, but felt that its jurisdiction on remand was limited solely to rendering an accounting. The plaintiffs argue in support of the trial court's decision, and cite George v. Wayne Circuit Judge, 336 Mich. 543 (1953). That case held that remand instructions from a superior court must be followed, not that a remand for a specific purpose prevents the court below from taking any action which justice requires so long as that action is not inconsistent with the judgment of the remanding tribunal. (See Garwood v. Burton, 274 Mich. 219.) Since we agree with the trial court's finding that there is no evidence to support a judgment against Evelyn Munson, and rather than remand the case for entry of an appropriate order, pursuant to this Court's authority under GCR 1963, 820, we hereby grant defendant Evelyn Munson's motion for a summary judgment.
Defendants next argue that the judgment should only run in favor of Alger Homes, and not to the individual plaintiffs. The transaction which was characterized as an equitable mortgage by this Court was between plaintiff Alger Homes and defendant Jack Munson. Plaintiff Michael Taines was involved in his capacity as an officer of Alger Homes. The plaintiffs argue that this issue was raised during this case's prior appearance in our Court and that this Court made no ruling on that issue. Since this Court declined to overturn the trial court's decision in this matter, plaintiffs argue that this constitutes res judicata.
While it is true that in the prior case, defendants did argue that the individual plaintiffs were not real parties in interest, and while it is true that this Court made no comment on that argument, we do not agree that this constitutes res judicata. While we can find no Michigan cases directly on point, we believe the better rule was announced by the Sixth Circuit in D'Arcy v. Jackson Cushion Spring Co, 212 F 889, 891-892 (CA 6, 1914):
"[E]very question properly involved upon the appeal, which is determined by the appellate court and constitutes, in part at least, the basis for its conclusion upon the ultimate question presented, becomes a part of the law of the case controlling the lower court in its subsequent proceedings."
The necessary corollary of this rule is that a question which was not determined by the appellate court, or does not constitute the basis for its conclusion upon the ultimate question presented, is not a part of the law of the case, and does not control the lower court in its subsequent proceedings. To straitjacket proceedings subsequent to a decision on a case by an appellate court by making assumptions regarding the disposition of arguments which the appellate court did not see fit to consider, is not, in our opinion, the wisest of policies.
After examination of the record, we find that the transactions involved were between defendant Munson and Alger Homes, Inc., and that at most the individual plaintiffs are but creditors of Alger Homes. The judgment of the court below is therefore amended to run in favor of the corporate plaintiff only.
The defendant next argues that the judgment in this case should in some manner protect him from actions by other creditors of Alger Homes. We believe this issue has been rendered moot by this Court's decision in Banner Lumber Co v. Alger Homes, Inc, 37 Mich. App. 434 (1971), and therefore no discussion is required.
Defendant next argues that the amount of credit awarded to him for payments he made on the land contract was insufficient. We feel that the decision of the trial court is not clearly erroneous, and therefore decline to reverse. Royer v. Eskovitz, 358 Mich. 279 (1960). Defendant's final argument is that the rate of interest awarded by the trial court was insufficient. Such award was within the discretion of the trial court, and we find no abuse of that discretion. (See Taines, supra, p 42.)
On cross-appeal, plaintiffs make two allegations of error. The first is that the trial court erred by allowing the defendants a credit of $10,000 as a "fee" for services performed in preserving the property. Plaintiffs argue that this figure is not supported by any evidence, and should therefore not be allowed. We disagree with the plaintiffs' position. The trial court, having previously ruled in defendants' favor, was obviously of the opinion that the equities in the matter lay with the defendants. Furthermore, as the trial court pointed out, but for the defendants' actions, the plaintiffs' interest in the property would have been totally lost. Granting, or refusing to grant, such an award is, we feel, within the trial court's discretion when called upon to render an equitable accounting in such a case. Under the totality of the circumstances, we cannot say that the award of the trial court is unreasonable, unsupportable or an abuse of discretion.
Plaintiffs' second argument on appeal again regards the trial court's award of interest. As we have just stated, such an award is within the discretion of the trial court, and we have found no abuse.
Affirmed in part and modified in part.
All concurred.